Star Delta Transformers Limited

Industrials — Specialty Industrial Machinery · BSE

₹498.60+₹6.65 (+1.35%)

DalalBaazaar Score

70 / 100

🟢 Good

Verdict

REASONABLE

Risk

Moderate

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, falling profits.

In simple words: Strong business and financial position, though profits are falling even as sales grow. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:00 pm

Understanding the Business

Company site ↗

The 60-second version of Star Delta Transformers Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Star Delta Transformers Limited manufactures, supplies, erect, tests, and commisions power and distribution transformers in India. The company operates through Manufacturing of Transformers and Solar Power segments.

IndustrySpecialty Industrial Machinery

SectorIndustrials

Employees75

Annual revenue₹143 Cr

How does it make money?

Turns over ₹143 Cr a year. Of every ₹100 of sales, about ₹8 reaches shareholders as profit, with ₹12 left at the operating level before interest, tax and depreciation. Each of its 75 employees supports ₹1.91 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.91 Cr

Who are its competitors?

The closest listed comparisons in its industry are SIEMENS LTD, ABB INDIA LIMITED, LARSEN & TOUBRO LTD., HAVELLS INDIA LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Some evidence

ROCE of 16.6% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE17.1%

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +105% while net margin moved +1% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+105%

Margin effect+1%

DalalBaazaar Score

70/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of -0.13 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

72/ 100

Good

How good the business is, ignoring the share price entirely.

Valuation

81/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

12.6x

3Y Median

19.2x

40 monthly readings · mean 23.2x · range 11.0x–60.0x

Sector Median

66.2x

median of 4 sector peers

🟢Current valuation is approximately 34% below its 3y median of 19.2x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 81% below the peer median of 66.2x.

vs. its own history

Cheap

19.2x median over 40 months · -34%

vs. sector peers

Cheap

66.2x median of 4 peers · -81%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

9.2x

PEG

0.46

What's Good / What's Bad

🟢 What's Going Well4

Return on equity is rising
ROE has improved from 9.2% to 12.4%.
Return on capital is rising
ROCE has improved from 12.6% to 16.6%.
Very low debt
Debt/Equity of 0.11x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 307% over 3 years, from ₹3 Cr to ₹11 Cr.
🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹14 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 34% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 81% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 20% a year✓ 27.0% CAGR
Latest reported year was 24.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 10%✓ 12.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹14 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.6x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 14%✓ 16.6%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 11 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✓ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✗ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 4 neutral · 2 weak

Market Cap

₹150 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

12.6x

Cheap

Cheap against the generic band

P/B Ratio

1.55x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹39.51

Profitable

Profitable on a per-share basis

ROE

12.4%

Moderate

Moderate capital efficiency

ROCE

16.6%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.11x

Low

Conservative leverage

Revenue Growth (YoY)

24.0%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-38.3%

Falling

Profits are shrinking

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹14 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

5.0%

Average

Average margins

Net Margin

6.1%

Average

Average bottom-line conversion

Current Ratio

5.91

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.13

Defensive

Steadier than the market

52W Range Position

33%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

450.7 / 476.6

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

58.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹70 Cr	₹100 Cr	₹71 Cr	₹143 Cr	+27.0%
EBITDA	₹9 Cr	₹15 Cr	₹16 Cr	₹17 Cr	+25.9%
EBITDA Margin	12.4%	14.7%	21.8%	12.1%	—
PAT (Net Profit)	₹6 Cr	₹11 Cr	₹11 Cr	₹12 Cr	+27.5%
EPS	₹19.19	₹37.05	₹35.42	₹39.79	+27.5%
ROE	9.2%	15.1%	12.6%	12.4%	—
ROCE	12.6%	21.0%	17.2%	16.6%	—
Total Debt	₹3 Cr	₹2 Cr	₹2 Cr	₹11 Cr	+59.7%
Free Cash Flow	-₹17 Cr	-₹8 Cr	₹1 Cr	-₹14 Cr	—

🟢 Revenue has grown at 27.0% a year over 3 years.

🟢 EBITDA has grown at 25.9% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 12.1% over 3 years.

🟢 PAT (Net Profit) has grown at 27.5% a year over 3 years.

🟢 EPS has grown at 27.5% a year over 3 years.

🟢 ROE has risen from 9.2% to 12.4% over 3 years (+3.2 pts).

🟢 ROCE has risen from 12.6% to 16.6% over 3 years (+3.9 pts).

🔴 Total Debt has grown at 59.7% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹118 Cr

Total Liabilities

₹22 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹11 Cr

Capex

-₹3 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

77.0%

Corporate Actions

Ex-Dividend Date

18 Sept 2015

Peer Comparison

Company	P/E	ROE
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%
LARSEN & TOUBRO LTD.	30.1x	15.2%
HAVELLS INDIA LIMITED	43.5x	17.1%

Recent News

1 positive2 mixed1 negative2 general

Star Delta Transformers Share Price Rise and Fundamentals

Univest, 14 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Star Delta Transformers Upper Circuit Today: Price, Data and Peers

Univest, 14 Oct

Star Delta Transformers Q1 Results: Unaudited standalone figures filed

scanx.trade, 16 AugResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Star Delta Transformers Ltd. Peer Comparison – Compare with Others

Value Research, 30 Aug

Star Delta Transformers standalone net profit declines 38.33% in the June 2026 quarter

Business Standard, 14 AugResults

🔴Potentially negativeReported deterioration, which feeds the growth and margin inputs on this page directly.

Star Delta Transformers revenue up 22% in FY26; net profit rises 12%

scanx.trade, 29 SeptResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Valuation

MiddlingProfitability

WeakRisk

Points for each in the Score ↑

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last. 2 high-severity red flags sit above this conclusion and should be read first.

1 of 5 tripwires tripped — Free cash flow remains positive · see Key things to watch ↑